Power game behind power projects

Shimla : A group of companies accused by the BJP of making payoffs to Himachal Pradesh Chief Minister Virbhadra Singh’s family for power projects, a group of companies linked to former Andhra Pradesh chief minister Y S Rajasekhara Reddy’s family, and firms linked to Congress politicians in Karnataka are among those allotted most of the small hydro projects in Karnataka — the frontrunner in such projects in the country.

Analysis of 298 allotments of small hydro projects by the Karnataka Renewable Energy Development Limited (KREDL) over the past five years, for production of 1,718 MW of power, also shows that projects accounting for at least 880 MW went to a small cluster of 14 firms, operating under 64 different names and led by directors with overlapping interests.

The allotments of these small hydro projects have come under the scanner following a corruption investigation by the state’s Lokayukta police against a senior IAS officer and former managing director of KREDL, Kapil Mohan, who is accused of holding assets disproportionate to his known income.

Some of the biggest beneficiaries of small hydro project allotments in Karnataka are firms run by New Delhi businessman Vakamulla Chandrashekhar, which have been awarded eight projects for generation of a total of 130 MW of power. Last year the BJP had accused Virbhadra Singh of receiving kickbacks from two firms owned by Chandrashekhar — Venture Energy and Technologies and Tarini Infrastructure Pvt Ltd — for awarding hydel projects.

The BJP had alleged that Chandrashekhar granted unsecured loans to the tune of Rs 3.9 crore to Virbhadra and his family, and that the CM’s relatives held stakes in the two firms of Chandrashekhar allotted hydel projects in Himachal.

One of these projects was the 15 MW Saikothi plant in Chamba, allotted to Venture Energy. While the BJP government of Prem Kumar Dhumal had cancelled it for violations in the MoU, Virbhadra had restored it in 2005, during his earlier stint in power, overruling objections by the state electricity board. Later, two extensions were granted to it by the BJP government in 2007 and 2012. In 2013, when he returned to power, Virbhadra gave the company another extension for six months. Following BJP accusations, this extension was withdrawn and the allotment of project cancelled. Since allegations that Virbhadra’s family also owned shares in Chandrashekher’s Tarini Infrastructure company surfaced, all the dealings of the CM’s relatives are under probe by the Income tax Department and Enforcement Directorate.

A PIL in this regard is pending in the Delhi High Court, and the CBI has submitted a report.

An Income Tax probe is also underway in another deal of Chandrashekhar with Virbhadra’s son Vikramaditya Singh. In Karnataka, four companies linked to Chandrashekher — B Soilmec India Pvt Ltd, Tarini International, West Mountain Power Ltd and Frontier Offshore Drilling India Pvt Ltd — have been awarded eight projects.

According to Documents of Registrar of Companies and the KREDL database. The other major beneficiaries of the small hydro project allocations in Karnataka include two firms linked to YSR Congress president Jagan Mohan Reddy’s sister Y S Sharmila and her husband Anil Kumar Morsupalli. XS Hydro Energy Pvt Ltd and Vijaya Green Power have been awarded contracts for three hydel projects, for generation of 51 MW.

Fourteen of the projects, for generation of 134 MW, have been allotted to 11 firms linked to Karnataka Congress MLA from Mangalore City B A Mohiuddin Bava’s brother Farookh Bava and Telangana businessman Anil Kumar Chalamashetty. “My brother has been in the renewable energy sector for a long time, even before I became an MLA. More than two years ago when Shobha Karandlaje (of the BJP) was the energy minister, he got a couple of small hydel projects. It was before I became an MLA. I have nothing to do with the business interests of my brother,” Mohiuddin Bava said. Projects in bulk also went to a group of 10 companies linked to Anitha Giridhar Rao, the promoter of the firm Asia Pacific Industries, and a cluster of firms with ties to Telangana businessman Sagiraju Arun Kumar.

The small hydel sector is among the most cost-effective and viable renewable energy sectors in the country and Karnataka has allotted more projects than any other state, in an effort to achieve a target of 3000 MW, both under the previous BJP and the current Congress governments.

The renewal of the projects has mostly happened under Congress watch. However, these small hydro projects are often opposed by environmentalists on account of their frequent location in protected forest areas. Developers of these small hydel projects can get Central government subsidies to the tune of Rs 5 crore per project along with Rs 10 lakh for the project preparation phase.

They are also guaranteed power purchase at the rate of Rs 2.30 KW in Karnataka as well as a 30-year lease on project land. “Some of the companies may be taking permission for projects and may be transferring these to other parties. I will get it checked up,” Karnataka Energy Minister D K Shivakumar said when contacted.

A senior KREDL official, however, said they were “not bothered about the antecedents of companies coming forward to develop projects”. “We just want more and more projects to meet the power needs of Karnataka. The state is witnessing four power cuts per day. Our only concern is that the companies must generate power,” he said.